Copper prices climbed on Monday as the dollar weakened ahead of the US presidential election and on prospects of additional stimulus measures from Chinese authorities.
A gauge of the US currency fell as investors scaled back bets on Donald Trump winning the election, with recent polls suggesting Kamala Harris was gaining ground.
In a highly anticipated move, China’s National People’s Congress Standing Committee held a meeting on Monday morning, where it discussed plans to raise local governments’ debt ceilings to address hidden debt, according to the official Xinhua News Agency.
Copper rose 1.6% to $9,768 a tonne in early morning trade on the Comex in New York.
[Click here for an interactive chart of copper prices]
Most base metals posted losses last month as initial optimism over China’s efforts to spur growth waned, amid doubts about their effectiveness.
Analysts cited by AFP noted that if former President Trump were to triumph over Vice President Harris in Tuesday’s election, Beijing’s stimulus measures could expand significantly.
“The size of China’s fiscal stimulus package would be around 10–20% larger under a Trump victory than in a scenario where Harris wins,” Ting Lu, chief China economist at Nomura, stated in a note last week.
Trump has threatened to increase tariffs on US imports from China by 60%, with the possibility of going as high as 200% in an extreme case. Meanwhile, Harris has not indicated any significant shift from the Biden administration’s trade approach.
(With files from Bloomberg)
